Weekend update

Weekend update

Congress is back at work on Capitol Hill this week. The FEHBlog did find an easy to read list of upcoming Congressional hearings on Congress.gov. The FEHBlog did not find any hearing relevant to the FEHBP coming up.

The FEHBlog is following news about the COVID-19 epidemic. The Wall Street Journal reports that the number of cases outside China is growing particularly in South Korea (602 cases) and Italy (155 cases). There are 34 cases in the U.S. In a Centers for Disease Control conference with the press last Friday, Dr. Nancy Messonnier explained that

We are making our case counts in two tables.  One only tracks people who were repatriated by the state department, and the second tracks all other cases picked up through U.S. public health network.  CDC will continue to update these numbers every Monday, Wednesday, and Friday.  We are keeping track of cases resulting from repatriation efforts separately because we don’t believe those numbers accurately represent the picture of what is happening in the community in the united states at this time.  As of this morning, when you break things up this way, we have 13 U.S. cases versus 21 cases among people who were repatriated [here].  The repatriated cases include 18 passengers from the “diamond princess” and three from the Wuhan [China] repatriation flights

The Wall Street Journal confirms the growing trend of large health insurers to offer their own primary care delivery services to their health plan members [previously documented by the FEHBlog].

“It’s very worrisome for hospitals,” said Chas Roades, a health-care consultant. “Suddenly, the plan you’re relying on for payment is also competing with you at the front end of the delivery system.”

Hospitals’ biggest concern may be the power that primary-care doctors have over where their patients go for care such as imaging scans and specialist procedures. Hospitals rely on doctors to direct patients to them for such services—one reason they have bought up physician practices. Insurer-owned clinics might refer patients away from certain hospital systems, cutting off important revenue. 

The FEHBlog in contrast is delighted with this trend which will hold down costs while improving health care quality. Competition itself is healthy. “’Health care has got to be more seamless and more integrated,” said Rob Falkenberg, chief executive of UnitedHealthcare’s California operation.” Agreed.

Fierce Healthcare reports that Oscar Health has creating a $3 per prescription formulary of about 100 popular prescription drugs and insulin. The formulary went into effect on January 1, 2020 for about half of Oscar’s health plan members. The other half if covered by Medicare or live in certain states like New York which have not approved the formulary. The article explains that

Oscar was able to price the drugs so low through plan design.“The price we pay to acquire the drug for our members has not changed,” [Oscar spokesperson Jackie] Kahn said. “Instead, we chose to have our members pay $3 and we are covering the rest.”

Tuesday Tidbits

The Office of Personnel Management released today its 2019 report on the outcome of Health Care Quality, Customer Service, and Resource Utilization measures (“QCR”) applied to the FEHB plan carriers. The good news is that “A significant number of FEHB carriers demonstrated improvement across a number of QCR measures showing that efforts to improve care and customer service are producing positive results.” The FEHBlog can tell you that carriers put a lot of effort into boosting these scores.

The chart from this report that most impressed the FEHBlog is the chart on page 5 showing steady improvement in the diabetes type 2 control measure. In the FEHBlog’s view, credit for that improvement principally belongs to the plan members who confront this disease by following their doctor’s advice and health plan input.

The FEHBlog also wants to readers to know that yesterday’s FEHBlog tirade was directed at the CMS civil monetary penalty proposal and not at the FEHB plans members with primary Medicare A and B coverage. Those members go along way toward controlling everyone’s FEHBP premiums by picking up Part B. Coordination of benefits with Medicare is a major and necessary part of the carrier’s workload and in the FEHBlog’s experience they pay close attention to it just like the QCR scores.

Express Scripts has issued its annual 2019 Drug Trend report. Fierce Healthcare reports that “[Cigna’s] pharmacy benefit manager found that medications for inflammatory conditions such as psoriasis and rheumatoid arthritis drove 43.7% of spending, by far the highest among the different classes.” This report always is interesting reading.

It’s also worth calling readers’ attention to HHS’s Agency for Healthcare Research and Quality’s (“AHRQ”) TAKEheart Initiative which was launched in the Spring of 2019.

Currently, only 1 in 5 of eligible patients with serious cardiac conditions enroll in cardiac rehabilitation (CR), which has been shown to improve health and prevent hospital readmissions. TAKEheart takes aim at these missed opportunities by spreading two evidence-based practices shown to boost rates of CR referral of eligible patients. These strategies involve automatically referring patients to CR through electronic health record prompts and ensuring that a staff member or lay navigator helps coordinate the patient’s referral process.

Recently, TAKEheart reached an important milestone. We’ve recruited the first of two waves of 50 hospitals and have begun the training and support needed for implementing automatic electronic referral to CR as well as care coordination.

That good news to hear in American Health Health MonthP.

Weekend update

Congress remains in session this coming week on Capitol Hill. Tomorrow the President will deliver his proposed FY 2021 budget to Congress. The Wall Street Journal reports that the

$4.8 trillion budget [proposal] charts a path for the start of a potential second term, proposing steep reductions in social-safety-net programs and foreign aid and higher outlays for defense and veterans.

[The safety net program savings include] $130 billion from changes to Medicare prescription-drug pricing.

Federal News Network advises that

Signs indicate the Trump administration is still pursuing the merger of the Office of Personnel Management with the General Services Administration, despite recent congressional language prohibiting the transfer of OPM statutory functions to other agencies.

The administration will, for example, issue a joint budget request for OPM and GSA for 2021 [just like the FY 2020 budget], Federal News Network has learned

Of course, rather than prohibiting the transfer, Congress more accurately put the merger on hold pending an independent study of the transfer by the National Academy for Public Administration. The report on the study is expected to be submitted in June 2020.

OPM released additional guidance on the Wuhan or novel coronavirus to Chief Human Capitol Officers on Friday February 7. Here’s a link to the Centers for Disease Control’s website about reports of the disease in our country.

Healthcare Dive reports that

Telehealth and remote monitoring are becoming significant forces in healthcare delivery, according to a new survey of 1,300 primary care and specialty physicians released Thursday by the American Medical Association.

The number of physicians who use telehealth for visiting with patients has doubled between 2016 and 2019, although the overall number remains relatively low with 28% of surveyed physicians reporting they have adopted telehealth technology. Remote patient monitoring has also grown, from just 13% of physicians using it in 2016 to 22% in 2019.

That’s encouraging news.


Today, the Department of Health and Human Services released the proposed 2021 Affordable Care Act notice of benefit and payment parameters. The Department issued a fact sheet on the 245 page notice. The notice is of principal relevance to qualified health plans in the ACA marketplaces. Two items in the notice are relevant to the FEHBP generally:

  • “The proposed 2021 maximum annual limitation on cost sharing is $8,550 for self-only coverage and $17,100 for other than self-only coverage. This represents an approximately 4.9 percent increase above the 2020 parameters of $8,150 for self-only coverage and $16,300 for other than self-only coverage.”
  • We propose changes to the policy regarding how drug manufacturer coupons accrue towards the annual limitation on cost sharing i n response to stakeholder feedback indicating confusion about the current regulatory requirement. We propose to revise the regulation finalized in the 2020 Payment Notice to provide that issuers would be permitted, but not required, to count toward the annual limitation on cost sharing amounts paid toward reducing out-of-pocket costs using any form of direct support offered by drug manufacturers to enrollees for specific prescription drugs. 

Of interest to insured FEHB plans,

We propose to amend current [medical loss ratio] MLR regulations to require issuers to deduct from incurred claims the prescription drug rebates and other price concessions attributable to the issuer’s enrollees and received and retained by an entity providing pharmacy benefit management services to the issuer. We further propose to clarify more generally that issuers must report expenses for services outsourced to or provided by other entities in the same manner as issuers’ expenses for non-outsourced services. These changes would help lower premiums by helping ensure that consumers’ premiums reflect the full benefit of prescription drug rebates and are not artificially inflated by outsourcing expenses. We also propose to clarify that expenditures related to certain wellness incentives in the individual market qualify as quality improvement activity expenses in the MLR calculation.

The Department is allowing thirty days for public comment. The final notice should be issued well before the 2021 FEHB benefit and rate proposal must be submitted on May 31, 2020.

In other news

  • HHS Secretary Alex Azar announced that the Wuhan coronavirus represents a public health emergency in our country. This declaration, among other things, makes special funding available to state, tribal, and local health departments as the government collectively works to keep the risk of the disease low.
  • Healthcare Dive reports that in their public comments health insurers and employers reacted negatively to the Administration’s cost sharing transparency proposed rule.
  • The Hill reports that the Food and Drug Adminstration has approved the first prescription drug to treat peanut allergies. “Aimmune Therapeutics is behind the drug, called Palforzia, which exposes patients to small amounts of peanuts and helps build up their resistance. “
  • The Wall Street Journal reported earlier this week that

Screening for lung cancer reduces deaths among current and former heavy smokers, according to a new study published Wednesday that adds to the evidence supporting wider testing.

The study, conducted by researchers in the Netherlands and Belgium and published online by the New England Journal of Medicine, found that scanning the lungs of heavy smokers reduced lung-cancer deaths by 24% in men and 33% in women over the course of a decade.

Have a great Super Bowl weekend.

Midweek Update

The FEHBlog wishes to remind his loyal readers that you may subscribe to FEHBlog emails which arrive with the full posts the morning after the post goes live. A subscription box prominently appears on the right margin of the FEHBlog page at ermersuter.com

Has any law generated more litigation in a short period of time than the Affordable Care Act??? Katie Keith in the Health Affairs blog provides a lengthy status report on the major ACA cases pending in the U.S. Supreme Court and the U.S. Court of Appeals.

In other judicial news, the U.S. District Court for the District of Columbia ruled yesterday that the Department of Health and Human Services failed to follow the Administrative Procedure Act in certain respects with respect to its 2013 and 2016 rule makings on access to medical records by patients and third parties such as lawyers and insurers. The details are explained in this Health Security IT article. Due to the importance of this issue to HHS, the FEHBlog expects the agency to take remedial administrative action quickly.

In good prescription drug news:

  • Healthcare Dive reports that pharmaceutical manufactures finally are rolling out biosimilar drugs which action will lower the cost of expensive specialty drugs over time.
  • CVS Health announced today “a new solution eliminating member out-of-pocket costs associated with all diabetes prescription medications, including insulin. Offered through the company’s pharmacy benefit manager (PBM), CVS Caremark, RxZERO enables employers and health plan sponsors to leverage formulary and plan design approaches to offer all categories of diabetes medications at zero dollar out of pocket for their members without raising costs for the plan sponsor or increasing premiums or deductibles for all plan members.”

Thursday Miscellany

At last year’s OPM AHIP FEHBP Carrier Conference, a Centers for Disease Control scientist announced that the U.S. Surgeon General soon would be issuing a new comprehensive report on tobacco use in the U.S. That report was issued today. It

  • Examines the effectiveness of various smoking cessation tools and resources;
  • Reviews the health effects of smoking and catalogues the improvements to health that can occur when smokers quit;
  • Highlights important new data on populations in which the prevalence of smoking is high and quit rates are low; and
  • Identifies gaps in the availability and utilization of programs, policies, and resources that can improve cessation rates and help smokers quit.

Here’s a link to OPM’s Quit Smoking website which discusses the FEHBP generous tobacco cessation benefits.

The CDC updated the public on its important antibiotic resistance solutions initiative.

CDC’s AR Solutions Initiative invests in national infrastructure to detect, respond, contain, and prevent resistant infections across healthcare settings, food, and communities. CDC funding supports all 50 state health departments, six local health departments, and Puerto Rico and the U.S. Virgin Islands.  Through these investments, CDC is transforming how the nation and world combat and slow antibiotic resistance at all levels.

Good luck.

The FEHBlog has discussed the relatively new, cooperative effort of hospitals to create a public asset, known as Civica Rx, to help solve drug shortages and lower the cost of generic drugs. Today, Civica Rx and the Blue Cross Blue Shield Association announced

their partnership to create a new subsidiary dedicated to lowering the cost of select generic drugs. The subsidiary is being formed in response to the impact of high drug costs on the health of Americans and the overall affordability of health care. Other health plans, employers, retail partners and health care innovators who share the belief that patients and their needs come first are invited to join the initiative.

The subsidiary will acquire and develop Abbreviated New Drug Applications (ANDAs) for select generic drugs and partner with Civica and manufacturing partners to bring more affordable generic drugs to uncompetitive markets in exchange for aggregated volume and multiyear purchasing commitments. Initially, several generic medications identified as having high potential for savings will be prioritized by the partnership and will evolve into a platform that can be used to enhance competition for additional generic drugs.

The new operation expected to start delivering product in early 2022. Strong move.

The American Hospital Association now offers a webpage with updates and resources concerning the Wuhan coronavirus.